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FAMU Fires Law School Dean, Hires New Dean

Percy Luney is removed after audit finds the school has a possible ghost employee.

By David Damron
Sentinel Staff Writer

June 8, 2005

Florida A&M University placed the dean of its Orlando law school on administrative leave and named a replacement Tuesday, citing early results of a payroll audit that turned up a possible ghost employee at the new college.

The removal of Percy Luney, who led the school since 2001, stunned the local legal community. Some observers said the dean had estranged some alumni and supporters, however, by not boosting black enrollment at the historically black college.

Castell Bryant, interim president of FAMU, said her decision was based solely on the audit and not on the racial distribution at the college or other job-related issues.

"This decision was mine," Bryant said. "This is a payroll-audit issue."

Bryant would not speak in detail about the audit, saying only that final results would be presented to school trustees at the end of the month and would be a factor in whether Luney might be allowed to stay as dean or in another position.

But Bryant acknowledged that the early findings showed that a donor, Kentucky lawyer Shirley Cunningham Jr., appeared to have received a law-school salary without teaching, part of a deal for him to award a $1 million gift to the college.

"It is not customary for someone to make a donation to an institution . . . and present conditions of employment as a condition for it," Bryant said. Pressed to offer details, she said, "We haven't finalized that payroll audit."

James M. Douglas of Houston, a former president of Texas Southern University, will serve as interim dean, replacing Luney. Douglas served as an early consultant to the law school before it opened its doors to students in 2002. He also had been one of the original finalists for the dean's job.

"I'm here to act as kind of a stopgap between this administration and the next administration," Douglas said at the announcement in Orlando, "to make sure this law school does not lose ground in its development process."

Luney, 56, could not be reached for comment Tuesday.

In brief remarks by phone, Cunningham said that he planned to release documents later this week that indicate a "number of individuals at the university community knew of that donation" and its conditions.

Recent reports in the St. Petersburg Times and the Lexington (Ky.) Herald-Leader said Cunningham received $100,000, plus $25,000 in benefits as part of the donation deal. But Cunningham disputed those figures and said he would release his own accounting of it.

The Lexington lawyer, a sharecropper's son inspired to attend law school by former FAMU President Frederick Humphries, announced in 2001 that he was making a $1 million donation to endow a professorship at the new law school. Part of his wealth comes from the courtroom, where he has been on legal teams that sued Ford and Bridgestone/Firestone over defective tires and sued American Home Products, makers of the fen-phen diet-drug combination. Cunningham also taught trial law at the University of Kentucky.

At the time of the donation, the Orlando Sentinel reported that the first professor to fill Cunningham's endowed chair was "likely to be Cunningham himself."

Bryant said Cunningham's work -- or lack of it -- for FAMU came to light in a payroll audit she pushed as part of a larger review of spending and finances on campus. A string of mismanagement and financial-control issues has dogged FAMU in recent years, resulting in last year's removal of President Fred Gainous. Bryant inherited those money and leadership woes when she arrived in January.

Tom Gallagher, Florida's chief financial officer, and the state Department of Financial Services are looking at a number of potential "pending investigations" related to FAMU, agency spokeswoman Tami Torres said. The agency has divisions that probe misuse or abuse of taxpayer funds. Torres would not comment on that work, only to say that one inquiry involving FAMU's Institute on Urban Policy and Commerce is pending.

In a prepared statement, Bryant said FAMU's internal probe of its payroll made it "necessary to make this decision" regarding Luney.

Luney taught at the Duke University School of Law and served as dean at North Carolina Central University School of Law before coming to Orlando. He was widely touted for his role in leading the fledgling law school, which replaces the FAMU law school closed by the state in 1968.

The school gained provisional accreditation last year, which is adequate to let students with FAMU law degrees take the bar exam to become lawyers. The first graduating class of the new school received diplomas this spring.

The next milestone comes this fall, when the school is scheduled to leave its home of three years at Orange Avenue and Central Boulevard and move to a new $28 million facility under construction at Hughey Avenue and Washington Street.

Given his early successes, legal officials were shocked at the news of departure, speculating what other forces may have been at work.

Leonard Birdsong, a law professor at Barry University's law school in Orlando, said Luney, who arrived with experience and contacts in accreditation circles, appeared to have done everything right at FAMU. "I am shocked as to what happened," Birdsong said.

He said some people contend that not enough of FAMU's enrollment is black, however. Thirty-eight percent of FAMU's law-school enrollees are black, and 45 percent are white, according to school officials. Most of the other enrollees are Hispanic.

Birdsong, who has known Luney since they were students at Harvard Law School in the 1970s, said it is difficult to recruit and admit good students to a new school, particularly in a city without a black majority population. "Historically black schools certainly want to recruit black people. But you've got to make tough decisions," he said. "I can't fault Percy for what he's done."

Orlando City Council member Daisy Lynum said she also had heard complaints about the racial makeup at the law school but gave Luney credit for getting the program started. "He was recruited to get the school accredited," Lynum said. "He stayed focused on that mission."

Joseph Richard Hurt, dean of the Barry law school, said FAMU enrollment stacks up well compared with other historically black colleges of law. He cited American Bar Association statistics on North Carolina Central in Durham and Texas Southern in Houston, where fewer than half of the students are black.

Hurt said he had never heard of anything like the donation deal Cunningham worked out for himself. Still, with open records and discussion of the donation, he found it odd that it was seen as "something of a secret."

FAMU Law School Dean Suspended;
Program Under Criminal Investigation

The Associated Press
Tuesday, June 7, 2005

TALLAHASSEE, Fla. - The dean of Florida A&M University's law school was placed on paid leave amid the findings of a payroll audit, and an institute housed at the university is under criminal investigation for the possible misuse of taxpayer dollars, officials said.

Percy R. Luney Jr. was suspended after an audit uncovered information that made it "necessary," said interim president Castell Bryant on Tuesday. No further details were released, but the information would likely become public June 30, said school spokeswoman LaNedra Carroll.

When Luney took the top job in 2001, his annual salary was $195,000 - the highest of any FAMU faculty member at the time.

James M. Douglas, a former president of Texas Southern University, was appointed to temporarily replace Luney.

"Without question, Dean Douglas has the skills to give us what we need during this period," Bryant said in a statement. "Together, we will work to protect and secure the integrity of our law school."

Meanwhile, the Institute on Urban Policy and Commerce is under investigation by the Florida Department of Financial Services. Details of the investigation have not been made public.

The Institute's work was suspended in April, also based on a payroll audit, Bryant said. Last month, all institute employees were terminated.

The institute trained minority small-business owners and helped low-income citizens gain access to the Internet. Created at the urging of black lawmakers during the 2000 legislative session to generate economic opportunity in low-income communities, it had a budget of $1.5 million dollars.

FAMU has been under state scrutiny for financial mismanagement since audits cited untimely bank reconciliations, poor accounting practices, deficient check-writing controls and late vendor payments.

Bryant has enforced a spending moratorium on cell phone, travel and other routine expenses.